Experience Concepts in Housing Development - Proposal Dissertation

Introduction

In recent years several books have been published wherein statements were made on how the economy is changing and how companies can and must respond. Although the terminology varies per book there are common red lines to explore of visions and ideas, motivation and interest, to the field of dreams and experiences and need to experience. In literature, the emphasis is on intangible aspects of the business and the focus on the ultimate consumer experience. The most used term for this new economy is the “experience economy”. In the “experience economy” the focus is on the creation of an unique experience for the consumer.

Background

In situations of scarcity the focus of people is on their primary needs for living/surviving. In the prosperous economic conditions we apply to our new human needs are on a different level. The current system, designed to meet material needs, is rapidly being transformed into an economy that is responsive to the psychological needs.

The essence of the experience economy is that consumers, after satisfying their material needs, are increasingly looking to fulfil their psychological needs. They want to be more and more personally affected. Consumers are willing to pay extra for fulfilling their psychological needs. Experience as a consumer in buying and consuming goods is what the “experience economy” is all about. But how can companies act in general in the experience economy. What does a good or service need to have to qualify as a good experience.

Pine and Gilmore (1999) state that companies have to find new tools to achieve their intended objectives to secure profits. They call experiences the new source of adding value and the economic value of the fourth estate. Buying and consuming should be a valuable experience. Companies that realize that experiences are a separate economic product, will have the key to future economic growth. The future economic benefit can be obtained by requesting a price premium for a distinctive experience.

Jensen (1999) predicts a similar change. He predicts a shift of attention from material to emotional. According to Jensen (1999) we will be leaving the old information age and entering a new area. The age of “imagination”.
Jensen (1999) speaks in this context of a dream society, a society that will search in stories behind the products instead of their features and benefits. According to Jensen (1999) such emotional stories fulfill the need for emotional wealth in a society where material wealth is in abundance.

In planning and development, this trend is to perceive increasingly. In recent years developers went increasingly into the field of perception. Housing concepts are developed which attempt to satisfy consumers both housing functionally and emotionally. For the operationalization of experiences on project and product level, the terminology “experience concepts” is used.

Where in the past the main factor for housing development was location, developers are becoming more aware of the value of less tangible factors. In recent years it has became increasingly clear that besides hard site characteristics in the broadest and widest sense, less tangible factors such as atmosphere and image are getting more important for the value of property. This added value is in the sense of the living experience and the strong home feeling in the living environment. This added value is not only a benefit to the consumer but also to the developer while people will be prepared to pay more. These changes are often described as the changes into the “experience economy” and people's need for stimulus and entertainment.

In the area of housing development there is no structured implementation of the “experience concepts”. Theories of the experience economy are cited without a translation to the development sector. It is assumed that concepts lead to increase in value. The development and realization of a total living concept that considers the “experience of living” seems a possible method to be successful. A living concept with a better response to the demand of consumers, can then been seen as the added value for the consumer and can lead to a higher return for the property developer. In this process the holistic perception of the consumer is central. This is a demand site driven economy where there is “little” research available about how to adopt the theory in housing development and how this theory can be translated to housing development.

Research aims

The purpose of this research is to clarify the abstract notion of “experience concepts” within housing development. Emphasis will be on which aspects are relevant to the creation of this theoretical added value of experiences. The definition of “experience” will be formulated and how organizations can adopt and implement this in housing developments. Therefore the demand of the consumers to fulfill their psychological needs will be investigated, which then can be translated into the changes of adding value by creating “experiences”. The purpose is to create an overview of the relevant aspects creating these “experiences”, where the consumer is central to the process. This definition and method will then be tested in different cases. On the demand side of the market the needs of the consumer will be analyzed. The information resulting from this research is relevant to developers and other interested organizations who want to achieve a sustainable competitive advantage.

Objectives

This research is relevant because in the past there has been “little” scientific research conducted into the use of “experience concepts” and how to implement this in housing developments. The societal relevance of this research is that the knowledge concerning the implementation and testing of “experience concepts” in housing/real estate development will be increased. The following objectives have been identified:
To clarify the abstract notion of the “experience economy” and to explore where the theory is focused on.
To translate this theory to the real estate development.To exploration on how developers can use the theory to create an added value in the perception of the living experience of the consumer.
To investigate the influence of implementing the theory of the “experience economy” to neighbourhoods.
To investigate how the theory of the “experience economy” is implemented in development and to show how the theory is adopted by samples of “experience concepts” based on different angles.
Establish an overview and conclusions on how stakeholders engage themselves with the theory of the “experience economy”.

Research questions

Based on the objectives of the research the following research questions are developed. The research will lead to an answer to the following main question:

How can developers make use of the “experience economy” in the development of houses?

To answer the research question, the following sub questions have been established:
1. Where is the focus on creating experiences for consumers, to generate economic benefit, is coming from?
2. How can developers use the theory of the “experience economy” to create added value for the consumer in their developments?
3. How do “experience concepts” in housing development encourage wider development of the neighborhood?
4. What are experience concepts within the current real estate development?
5. How do stakeholders engage with the “experience economy” in the process of housing development?

Description of Methodology

The research is carried out based on the philosophy of critical realism. This approach is used to identify causal relations and mechanism. Identifying the causal relations will mean analyzing where the needs on the demand site (the consumer) is coming from. Identification of these causal relations will be related to the identification of empirical regularities, the mechanisms. In other words, this will be the translation of the theory of the “experience economy” to the development world and how it can be implemented. The main emphasis of this method is the combination of theoretical verification and situational validation. This theoretical verification and situational validation will be achieved through a combination of extensive and intensive research. Triangulation is applied to test and justify the outcomes.

The basis of the research will be established by a literature review. The abstract notion “experience economy” will be clarified and translated to the real estate world. Next stage will be social research based on constructivism used to acquire multiple perspectives and try to construct the reality.

Intensive research will be conducted through semi structured in-depth-interviews with experts to clarify the subject in relation to housing development and which aspects are considered to be of great importance in creating “experiences” for the consumers.
The interviews will be followed by case-studies wherein the emphasis will be on the process of coming to the core aspect (based on the “experience economy”) of a development concept. In these fundamentals the holistic perception of the consumer is central and will be analyzed. This analysis will be translated to relevant aspects of how to implement the aspects that need to be used to create an added value in the way of “experiences”.

Extensive research is done by means of surveys. Surveys will be done to test if the casual relations on the demand side are on the same line with the empirical regularities. Comparison of the semi-in-depth interviews, case study and surveys, might show a different way of applying the theory of the “experience economy” and the perception and experience of the consumer.

Stages of the use of methodology:
Choice of suitable and credible documents for literature review
Semi structured in-depth-interviews with experts
Case study of “experience concepts”
Case studies conducted within organizations
Consumer surveys
Comparison of outcomes

Stage 1: Literature interview

The literature review is to explore and clarify where the theory of the “experience economy” is coming from and is based on. The current economic situation is changing. Emphasis will be on causal relations on the demand site of the market, the psychological driven factors of where the needs of the consumer are based on and how this is changing. The process of transforming to a new stage of economy will be analyzed. The main resource of supplying this information will be educational literature.

Stage 2: Interviews

After identifying the theory behind the “experience economy”, stage 2 will be entered.
The fundamentals have now been made in stage one by analyzing the theory of the “experience economy”. In stage two experts will be interviewed to understand their opinions, experiences and relevant aspect needed in the process of adopting the “experience concept” in the housing development. The main importance of this stage is to define a view of how the experts think the process is established and which aspects are relevant to create “experience concepts” in the housing development.

To collect primary data the interviews are semi-structured face-to-face in-depth interviews with experts. The open questions will be related to the key subjects defined in stage 1. As Denscombe (2007) recommends, the interviewer has to be prepared to be flexible in the subjects to let the interviewee develop ideas and speak more widely. There will be more emphasis on the interviewee elaborating perspective.

The reason for using semi-structured face-to-face in-depth interviews is because of the direct contact between the interviewer and interviewee. Semi-structured interviews are used to gather detailed valid and reliable data with a wide view of the relevant aspects in relation to the “experience concepts”. The method is used to validate the results of the literature review and get a wider view of how to adopt the theory in the development. The emphasis will be on exploring new insight into how to adopt the “experience economy” in the real estate development.

Pilot interview will be sent to J. Prins, B. van Woezik and G. Squires. The first two named are specialists in this subject and teach this subject at the Fontys University of Applied Science on Real Estate in Eindhoven. Third person named is the tutor who is leading this research. All three can support with comments and suggestions where needed. Experts from different organizations will be interviewed. Subject areas within the housing development will be:
Architecture
Planning and development
Marketing

This sample size will be 6 experts divided in 2 on each subject. All interviewees will be asked for permission to tape record the interview. The tape recordings will be analyzed and transcribed. The transcripts will be returned to the interviewees for confirmation.

The relevance of stage two is to get a clear view of how “Experience Concepts” can be adopted and implemented in the housing development. Snowball technique will be applied to find out about related subjects which need attention or which people or projects are relevant to include in the research

Stage 3: Case study

Stage three will be case studies. The case studies are used to demonstrate what “experience concepts” are in the housing development and to do an in-depth study in the process of how organizations adopt the theoretical aspects of “experience concepts”. The emphasis will be on the empirical method of implementing the theory of the “experience economy” in the “real world”, the mechanism regularities. In this case study four projects will be analyzed.

Projects will be chosen based on the use of “experience concepts”. The main factor is that the holistic perception of the consumer is central in the concept.

The chosen case studies are:
1. Name project: Brandevoort
Location: Helmond
Description: Living in a 21ste century castle.
2. Name project: Haverleij
Location: Den Bosch
Description: Style, privacy, space and nature in historical architecture.
3. Name project: Meerhoven
Location: Eindhoven
Description: Living rich.
4. Name project: Westelijke Tuinsteden
Location: Amsterdam (Osdorp Meer en Oever)
Description: Garden city.

These concepts are chosen because of the variety in angles of implementing “experiences”. Project Brandevoort is an inspiration of several architect’s working together with the local authority. Haverleij is designed by one architect and this means a vision of one person. Meerhoven is a concept designed by the vision of the local authority. Westelijke Tuinstede is based on an old concept from the late 19th century which is now redeveloped on the same base because the formula is still very popular.

The focus in these case studies will be on the identified relevant aspects from the interviews structured in a conceptual framework. The conceptual framework will be the redline in the semi-structured interviews. This framework will be validated by J. Prins, B. van Woezik and G. Squires.

Focus of the case studies will be to analyze the adoption of the theoretical aspects in the process and the translation of these into the development. The purpose is to explore the affective key aspects.

The case study consists of semi-structured interviews with “first hand experts”. The reason for semi-structured interviews is because the outcomes must be in the direction of the relevant aspect notified in the interview of stage two. The open-ended questions will be recorded (with permission), transcript will be returned to interviewees for confirmation.

Each case study will comprise the sub areas as used in the interviews of stage two:
Architecture
Planning and development
Marketing

Stage 4: Surveys

In stage 4 surveys will be conducted to get a clear view of what the consumer is searching for in terms of living experience and on the basis of which driven factors consumers make the selection of their place to live. What is the process of thinking how consumers get to their choice and what are the most relevant aspects. Emphasis will be on how the consumer experiences living in and being part of an “experience concept”. Does the consumer verify the added value. The questionnaires will be structured based on the conceptual framework develop after stage two and used in stage three. The data can be used to generalise the opinions.

The letters will be randomly distributed in the neighbourhoods of the “experience concepts”. The sample size of the questionnaire will be 100, 25 in each neighbourhood. Expecting a responds of 25%, there will be 400 letters distributed, 100 in each neighbourhood.

The questionnaires will be presented to the consumers in a digital form on a website. This enables daily checking of live statistical results are. Before the consumers can respond to the questionnaires, they will receive a letter with all the information about the research. They can then enter the website with a special access code.

The type of questionnaire will be an attitude scale. The attitude scale is chosen because of the straightforward and direct approach. The attitude scale is a method of measuring attitudes based on consistent responses to particular ideas. The scale presents statements about what consumers think is the most and the least important factors, marking from one to five, for adding value to real estate.

Stage 5: Comparison and analyses

All the gained information from previous stages should now result in an overview of what the theory behind the “experience economy” is and what “experience concepts” are in the housing development. Experts have explained what is needed to create a valuable “experience concept” and the case studies have shown how “experience concepts” are implemented in the “real world”.

Stage four gives a clear view what the consumer is searching for and what the main factors are of coming to a decision for choosing a place to live. This overview can now be analyzed to create an overview of relevant aspects in relation to the theory of the “experience economy” in the real estate development. The developed overview of relevant aspects in “experience concepts” will be sent to the three experts J. Prins, B. van Woezik and G. Squires for confirmation.

Collection the data

The collected data will of exist out intensive and extensive data. Crucial components will lead the purpose sampling. Specific focus will be on the relevant aspect of applying and implementing the “experience concepts”. As Denscombe (2007) said about analysis of data, it should contain:
Preparation of the data.
All materials will be collated and organized in a compatible format, with the possibility of adding notes and recommendations by the researchers.
Familiarity with the data.
Understanding the data in context and recognizing implied meanings.
Interpreting the data (developing codes, categories and concepts).
Code the data, categorize these codes, identify themes and relationships, develop concepts and arrive at some generalized statements.
Key decisions in the analysis of the data
Prioritize certain parts of the data, reducing data, move towards key concepts, compare the new generalized conclusions with alternative theories and explanations.
Verifying data.
Validity, credibility, reliability, generalizability and objectivity.
Representing data.
Structured overview of the different views.
Ethics or practical considerations

Information, approaches and processes of organizations will stay protected in the summary of the results. All transcripts of interviews will be sent to the interviewees to confirm if the translation of the summary of outcomes is valid.

Timetable

References

Denscombe, M. (2007), The Good Research Guide for Small Scale Social Research Projects (third edition), Buckingham: Open University Press.

Jensen R. (1999), The Dream Society.

(a) Pine B.J., (b) Gimore J.H. (1999), The Experience Economy, Harvard Business School Press, Boston, Massachusetts.

Robson C. (2002), Real World Research (second edition), Oxford: Blackwell